Cautious welcome to Wolseley's Irish sale
Published: 12 January, 2010
DUBLIN: Irish business commentators have cautiously welcomed the sale of Wolseley's Irish merchanting arm.
Wolseley's decision to sell its Irish operation is part of a group strategy of focusing on areas where "we have built sufficient scale, established leading market positions and can deliver an appropriate financial return", according to its statement.
Wolseley Ireland Holdings lost €34 million in the 12 months to 31 July last on sales of €237 million. The Irish Times said: "This poses a tough challenge for its new owners."
The deal's structure means that they will have to repay €22 million to Wolseley at the end of their first year. But the numbers give some cause for hope the newspaper said. "Sales for the five months to December 31st were €75 million, indicating that they are running 25% below the previous financial year."
The Irish Times said the operation is losing €1 million a month, compared to almost three times that last year. "It's not ideal, but it does mean that the business is in sight of breaking even," the newspaper said.